SPRINGFIELD -- A private company hired to manage the Illinois Lottery is going ahead with plans to take over management July 1 despite a court ruling that could void the arrangement.

DOUG FINKE

SPRINGFIELD -- A private company hired to manage the Illinois Lottery is going ahead with plans to take over management July 1 despite a court ruling that could void the arrangement.

Northstar Lottery Group is hiring staff, preparing new games and moving the Lottery to new offices on Springfield’s west side while the legal issues are being resolved.

“Northstar is moving forward rapidly,” said spokeswoman Carolyn Grisko. “They have goals to meet in the current year and they are hiring. They are rebranding and developing an advertising campaign. They are upgrading technology.”

Authorization to turn lottery management over to a private firm was contained in an omnibus bill passed for the state’s $31 billion capital program. Among other things, the bill contained vehicle fee increases and liquor tax hikes that will be used to pay for construction projects.

An Illinois appeals court, though, said the bill was unconstitutional because it contained both the revenue increases and components that did not deal with revenue. The state is appealing the decision to the state Supreme Court, arguing that all of the bill dealt with the capital plan and is therefore constitutional.

If the Supreme Court decides in the state’s favor, everything can proceed as planned. However, if the court upholds the appellate court decision, lawmakers will be faced with having to reauthorize all of the various pieces, throwing the capital plan into chaos.

“We are coordinating with the state and we believe that one way or another, either through the courts or legislatively, the issue will be resolved,” Grisko said. “This management contract was undertaken by the state in order to free up the financial power that exists in the lottery. There is a great deal of revenue for education and the capital fund on the line.”

Lottery spokeswoman Sue Hofer declined to discuss what will happen if the court rules against the state.

“Right now the lottery private management contract is the law of the land, and we have to move forward with implementing it,” she said. “When the court makes a decision, we’ll take the steps necessary to comply with the court’s decision, if any steps are necessary.”

Lottery proceeds support education, but it is only a fraction of the total education tab in the state. The lottery sells about $2.2 billion worth of tickets, producing about $620 million in profits for schools.

The state believes a private manager will be able to increase sales and consequently the state’s profits, which would be used both for schools and capital projects. The hope is to double sales. Northstar’s plan is to get current players to play more often and also to entice people to buy lottery tickets who don’t buy them now.

Northstar is a consortium of three companies that already hold contracts with the lottery: GTECH, Scientific Games and Energy BBDO. It beat out two other bidders for the contract.

Grisko said the company has hired 30 recruiters, whose job will be to bring more retailers into the lottery system. There are about 7,000 lottery outlets now. The company wants to increase that to 12,000.

Grisko said the company is also focusing on integrating current lottery employees into the new operation. A stipulation of the management agreement was that state workers employed by the lottery would not lose their jobs.

As part of the deal, the lottery offices are being moved to 3201 Robbins Road in Springfield.

Grisko said the company is still on target to assume management duties July 1.

Doug Finke can be reached at (217) 788-1527.

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